# Tongwei (600438.SHG)

Canonical: https://gigainvestors.com/s/600438.SHG

Analysis as of: 2026-10-16T07:36:31.850Z. Financial observations: FY2000–FY2025.

Listing currency: CNY. Reporting currency: CNY.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: fail; earnings resilience is evidence only). Published buy qualification: no.

Share price: CNY 11.10 per share; close as of 2026-10-15.

## Checklist

### understandable: fail

- 3 revenue declines in the last 10 years (informational)

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 3

- Years with a net loss: 2

- Operating margin variation: 1.12×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.05×

- FY2017: 0.09×

- FY2018: 0.09×

- FY2019: 0.08×

- FY2020: 0.11×

- FY2021: 0.17×

- FY2022: 0.28×

- FY2023: 0.16×

- FY2024: -0.09×

- FY2025: -0.05×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- Recent gross margin fell 15.6pp below the typical margin (limit 4pp)

- ROIC, median of available years: 11.7%

- ROIC, second-lowest year: -3.5%

- Typical minus recent gross margin: 15.6 pp

- Typical gross margin (annual median): 18.3%

- Recent gross margin (lower of latest and 3-year median): 2.7%

- Years with nonpositive capital: 0

- Capital spending / revenue: 16.8%

- ROIC including acquisitions, ten-year median: -4.7%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 8.0%

- FY2017: 13.5%

- FY2018: 11.2%

- FY2019: 9.7%

- FY2020: 12.2%

- FY2021: 17.3%

- FY2022: 66.9%

- FY2023: 24.6%

- FY2024: -7.2%

- FY2025: -3.5%

### economics: fail

- owner earnings cash conversion below threshold

- incremental invested capital return below threshold

- Owner earnings / net income, 5-yr: -0.50×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: CNY -15B

- Net income, five-year total: CNY 31B

- Return on incremental invested capital: -4.2%

- Working capital / revenue, annual change: -0.4 pp

- Working capital / revenue, change between three-year averages: -3.4 pp

- Working capital / revenue, final three-year average: -2.8%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 0.94×

- FY2022: 0.98×

- FY2023: -0.69×

- FY2024: 3.98×

- FY2025: 1.14×

### management: fail

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- potential debt-funded buybacks (informational)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 11.2% vs -3.5%

- Per-share earnings: 0.30 to -1.58 (three-year endpoint medians)

- per-share value declined or ends nonpositive

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 3.3%

- Ordinary dilution, 5-year annual growth: -0.0%

- Market cap gain: CNY 71B

- Cumulative retained earnings: CNY 12B

- Diluted shares, 10-year annual growth: 3.3%

- Diluted shares, 5-year annual growth: -0.0%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value change: CNY -1.88

- Per-share value, starting three-year median: CNY 0.30

- Per-share value, ending three-year median: CNY -1.58

- Average buyback yield: 2.0%

- Buyback history: 1 years

- Debt-funded buybacks: Yes

- Acquisition spending: CNY 4.7B

- Cumulative net income, 10 years: CNY 42B

- ROIC, first three-year median: 11.2%

- ROIC, last three-year median: -3.5%

Chart: Earnings per share; fiscal year observations.

- FY2016: CNY 0.30

- FY2017: CNY 0.52

- FY2018: CNY 0.52

- FY2019: CNY 0.68

- FY2020: CNY 0.80

- FY2021: CNY 1.80

- FY2022: CNY 5.49

- FY2023: CNY 2.87

- FY2024: CNY -1.58

- FY2025: CNY -2.12

### accounting: pass

- Sloan accruals: -5.8%

- Receivables to sales index (DSRI): 0.43×

- Restructuring years, last five: 0

- Earnings backed by cash: Yes

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.13×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -6.6%

- FY2017: -3.6%

- FY2018: -2.8%

- FY2019: 0.6%

- FY2020: 0.9%

- FY2021: 0.6%

- FY2022: -12.5%

- FY2023: -10.4%

- FY2024: -4.2%

- FY2025: -5.8%

## Holders

## Price story

Down 81% since Jun 2022 · sales -8.6%

Story as of 2026-10-16T10:00:07.641Z; price observation 2026-10-15.

### Sales · FY2024–2025

sales -8.6%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: CNY 21B 

- FY2017: CNY 26B 

- FY2018: CNY 28B 

- FY2019: CNY 38B 

- FY2020: CNY 44B 

- FY2021: CNY 65B 

- FY2022: CNY 142B 

- FY2023: CNY 139B 

- FY2024: CNY 92B 

- FY2025: CNY 84B 

### Gross margin · FY2025

gross margin 2.7%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: 15.3% 

- FY2017: 19.1% 

- FY2018: 18.5% 

- FY2019: 18.2% 

- FY2020: 16.3% 

- FY2021: 25.3% 

- FY2022: 37.8% 

- FY2023: 25.2% 

- FY2024: 1.4% 

- FY2025: 2.7% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in solar; annual sales are CNY 84.1 billion.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:31.850Z); FY2025: revenue 84128281703.14; grossProfit 2271875192.89; margin = grossProfit / revenue.

### Why customers stay

Margins ranged from 1.4% to 25.2% during 2023–25; it earns 11.7% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:31.850Z); FY2023: grossProfit / revenue = 25.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:31.850Z); FY2024: grossProfit / revenue = 1.4%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:31.850Z); FY2025: grossProfit / revenue = 2.7%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:31.850Z); 10-year return on capital observations [[2016,0.07966425936823628],[2017,0.13533546780109887],[2018,0.11166674962952905],[2019,0.09731237836560555],[2020,0.1215658123560003],[2021,0.17311286774655585],[2022,0.6691808250455132],[2023,0.24615141607648047],[2024,-0.07217001573146187],[2025,-0.03484782422358106]]; median 0.11661628099276466. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 10 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:31.850Z); FY2017: growth capex 1482915201.1355338; upkeep 2845506358.894466; owner earnings 124552472.10553408. Growth capex / owner earnings = 11.905947558223097.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:31.850Z); FY2019: growth capex 2219829887.19; upkeep 1988339000; owner earnings 2634569000. Growth capex / owner earnings = 0.842578003153457.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:31.850Z); FY2020: growth capex 3066704092.6000004; upkeep 2419900000; owner earnings 3607923000. Growth capex / owner earnings = 0.8499915581901277.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:31.850Z); FY2021: growth capex 11287641087.15; upkeep 2687484000; owner earnings 7608996706.84. Growth capex / owner earnings = 1.483459846552849.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:31.850Z); FY2022: growth capex 10189771448.02; upkeep 5028144000; owner earnings 25271657735.739807. Growth capex / owner earnings = 0.4032094591724931.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:31.850Z); Dividend observations: [[2016,383145977.81],[2017,635400182.96],[2018,923627161.52],[2019,621179555],[2020,797541155],[2021,1084873112],[2022,4105411943],[2023,13817251072],[2024,5628105000],[2025,2182392355.12]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 45.7% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); 600438.SHG SharesStats.PercentInsiders = 45.714 percentage points; cache date 2026-10-16.

### What the price says

The price is 0.6 times annual sales; cash earnings are negative.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:31.850Z); Closing price 11.1 CNY; reporting-to-trading FX 1; FY2025 annual sales per share 18.688273880656606; price multiple 0.5939553364256456. FY2025 cash earnings/share -2.4249593269707446. Closing-price date 2026-10-15.

## Monthly share-price history (CNY per share)

- 2016-10: CNY 6.08 per share

- 2016-11: CNY 6.44 per share

- 2016-12: CNY 6.37 per share

- 2017-01: CNY 6.23 per share

- 2017-02: CNY 6.21 per share

- 2017-03: CNY 6.27 per share

- 2017-04: CNY 6.39 per share

- 2017-05: CNY 5.50 per share

- 2017-06: CNY 5.58 per share

- 2017-07: CNY 7.11 per share

- 2017-08: CNY 7.47 per share

- 2017-09: CNY 9.43 per share

- 2017-10: CNY 9.84 per share

- 2017-11: CNY 11.24 per share

- 2017-12: CNY 12.11 per share

- 2018-01: CNY 11.94 per share

- 2018-02: CNY 10.08 per share

- 2018-03: CNY 10.62 per share

- 2018-04: CNY 11.78 per share

- 2018-05: CNY 11.28 per share

- 2018-06: CNY 6.90 per share

- 2018-07: CNY 7.08 per share

- 2018-08: CNY 6.40 per share

- 2018-09: CNY 6.67 per share

- 2018-10: CNY 6.40 per share

- 2018-11: CNY 8.48 per share

- 2018-12: CNY 8.28 per share

- 2019-01: CNY 10.26 per share

- 2019-02: CNY 11.90 per share

- 2019-03: CNY 12.16 per share

- 2019-04: CNY 14.23 per share

- 2019-05: CNY 15.40 per share

- 2019-06: CNY 14.06 per share

- 2019-07: CNY 14.56 per share

- 2019-08: CNY 14.65 per share

- 2019-09: CNY 12.74 per share

- 2019-10: CNY 12.72 per share

- 2019-11: CNY 13.10 per share

- 2019-12: CNY 13.13 per share

- 2020-01: CNY 13.54 per share

- 2020-02: CNY 17.25 per share

- 2020-03: CNY 11.61 per share

- 2020-04: CNY 15.11 per share

- 2020-05: CNY 13.70 per share

- 2020-06: CNY 17.38 per share

- 2020-07: CNY 27.30 per share

- 2020-08: CNY 24.40 per share

- 2020-09: CNY 26.58 per share

- 2020-10: CNY 30.70 per share

- 2020-11: CNY 30.80 per share

- 2020-12: CNY 38.44 per share

- 2021-01: CNY 46.00 per share

- 2021-02: CNY 46.98 per share

- 2021-03: CNY 32.74 per share

- 2021-04: CNY 35.23 per share

- 2021-05: CNY 40.13 per share

- 2021-06: CNY 43.27 per share

- 2021-07: CNY 43.22 per share

- 2021-08: CNY 61.00 per share

- 2021-09: CNY 50.94 per share

- 2021-10: CNY 57.23 per share

- 2021-11: CNY 44.92 per share

- 2021-12: CNY 44.96 per share

- 2022-01: CNY 37.35 per share

- 2022-02: CNY 42.90 per share

- 2022-03: CNY 42.69 per share

- 2022-04: CNY 41.10 per share

- 2022-05: CNY 45.19 per share

- 2022-06: CNY 59.86 per share

- 2022-07: CNY 53.81 per share

- 2022-08: CNY 52.88 per share

- 2022-09: CNY 46.96 per share

- 2022-10: CNY 43.50 per share

- 2022-11: CNY 43.32 per share

- 2022-12: CNY 38.58 per share

- 2023-01: CNY 42.21 per share

- 2023-02: CNY 41.90 per share

- 2023-03: CNY 38.91 per share

- 2023-04: CNY 39.83 per share

- 2023-05: CNY 34.12 per share

- 2023-06: CNY 34.31 per share

- 2023-07: CNY 34.80 per share

- 2023-08: CNY 32.08 per share

- 2023-09: CNY 32.26 per share

- 2023-10: CNY 27.30 per share

- 2023-11: CNY 24.50 per share

- 2023-12: CNY 25.03 per share

- 2024-01: CNY 23.30 per share

- 2024-02: CNY 26.50 per share

- 2024-03: CNY 24.87 per share

- 2024-04: CNY 21.70 per share

- 2024-05: CNY 23.01 per share

- 2024-06: CNY 19.11 per share

- 2024-07: CNY 18.13 per share

- 2024-08: CNY 19.01 per share

- 2024-09: CNY 22.83 per share

- 2024-10: CNY 30.75 per share

- 2024-11: CNY 27.45 per share

- 2024-12: CNY 22.11 per share

- 2025-01: CNY 20.46 per share

- 2025-02: CNY 21.09 per share

- 2025-03: CNY 19.13 per share

- 2025-04: CNY 16.31 per share

- 2025-05: CNY 16.29 per share

- 2025-06: CNY 16.75 per share

- 2025-07: CNY 20.43 per share

- 2025-08: CNY 22.03 per share

- 2025-09: CNY 22.29 per share

- 2025-10: CNY 24.78 per share

- 2025-11: CNY 22.88 per share

- 2025-12: CNY 20.52 per share

- 2026-01: CNY 18.20 per share

- 2026-02: CNY 18.16 per share

- 2026-03: CNY 16.52 per share

- 2026-04: CNY 17.37 per share

- 2026-05: CNY 14.77 per share

- 2026-06: CNY 12.11 per share

- 2026-07: CNY 11.68 per share

- 2026-08: CNY 11.59 per share

- 2026-09: CNY 11.52 per share

- 2026-10: CNY 11.58 per share

## Annual estimated value (CNY per share)

- FY2016: low CNY 1.71 per share, central CNY 2.03 per share, high CNY 2.21 per share

- FY2017: low CNY 1.28 per share, central CNY 1.37 per share, high CNY 1.49 per share

- FY2018: low CNY 1.18 per share, central CNY 1.34 per share, high CNY 1.44 per share

- FY2019: low CNY 1.13 per share, central CNY 1.40 per share, high CNY 1.55 per share

- FY2020: low CNY 2.17 per share, central CNY 2.45 per share, high CNY 2.60 per share

- FY2021: low CNY 14.12 per share, central CNY 20.00 per share, high CNY 23.43 per share

- FY2022: low CNY 40.22 per share, central CNY 54.67 per share, high CNY 63.08 per share

- FY2023: low CNY 36.89 per share, central CNY 50.89 per share, high CNY 59.04 per share

- FY2024: low CNY 23.57 per share, central CNY 26.11 per share, high CNY 29.49 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.